Government Revenue: The Ministry of Finance announced that tax regulations would be reviewed to
ensure that the country optimised benefits from its mineral resources.6 In April, the Public Finance
Management (PFM) and Audit Office Bills were signed into law. The PFM Act provides the regulatory
framework for the management of public finances, promotes good governance as well as strengthening
the current accounting system. The Audit Office Act strengthens the provisions of the Audit and
Exchequer Act on audits by the Comptroller and Auditor General. It also separates the Auditor General’s
management function from the audit and oversight role. The Ministry of Finance is now in the process
of drafting the necessary Statutory Instruments to enable prompt operationalisation of the two Acts
to ensure improved accountability over the use of public resources.7 The government also convened
a four-day workshop on Public Financial Management focused on result-based management and
enhanced accountability in using public resources.8
Meanwhile the Ministry of Finance reported that the government had collected more than its revenue
targets netting US$411,5 million against a target of US$317,7 million for the first half of 2010. This
was complimented by the increase in revenues from mineral exports. According to the Minerals
Marketing Corporation of Zimbabwe (MMCZ) exporting earnings from mining rose to US$403 million
in the first five months to May, up from US$191, 9 million realised during the same period last year. In
the first week of July 2001 the Ministry of Finance had just promulgated a proposed draft of a new
Income tax Law. The aim, according to the Finance Ministry, was to expand the income tax base as
well as bring the legislation into line with international best practice.
Bilateral Issues: On 3 March, Parliament ratified the Bilateral Investment Promotion and Protection
Agreement (BIPPA) that was signed by Zimbabwe and South Africa on 27 November 2009, a move
aimed at stimulating investor confidence.9 The Grain Marketing Board (GMB) secured funds to purchase
maize and started accepting deliveries, pledging timely payments to farmers.10 The Prime Minister,
Morgan Tsvangirai also signed the BIPPA Agreement with South Korean government and he encouraged
Korean business people to invest in Zimbabwe11. In line with the above, Zimbabwe and China also
signed bilateral pacts12.
Re-engagement with IFIs and other multilateral agencies: The Minister of Finance met officials at
the International Monetary Fund (IMF) on 19 February 2010. Following these engagements, the
Executive Board of the IMF has restored Zimbabwe’s voting and related rights, and its eligibility to
use resources from the Fund’s General Resources Account (GRA) subject to clearance of US$ 140
million arrears to the Poverty Reduction and Growth Trust (PRGT). The country had lost its voting
rights in the IMF in 2003 due to non-payment of overdue obligations to the Fund. Though superficial,
this is a critical step for the country to regain its international creditworthiness and boost investor
confidence. The US, UK and the African Development Bank (AfDB) have publicly expressed willingness
to assist Zimbabwe noting the improvement in the implementation of specific targets in STERP13.
6
ìGovt to review tax lawsî The Herald 9 March 2010 page B1
7
ìPublic Finance Management and Audit Office Bills Signed Into Lawì 7 April 2010 on www.zimtreasury.org
8
ìAfDB to assist Zim in debt managementì 28 April 2010 on www.zimtreasury.org
9
ìParly ratifies BIPPAî in the Herald 4 March 2010 page 2
ìGMB secures funds to buy maizeì 14 April 2010 on www.zimtreasury.org
10
PM Courts South Korean Investors; The Herald, 26 May 2010, pp:b1
11
. Zim, China Sign Bilateral Pacts; The Herald, 2 June 2010,pp:1.
12
AfDB willing to assist Zim; The Business Herald, 26 February 2010, pp:2.
13
CIVIL SOCIETY MONITORING MECHANISM (CISOMM)
SIX MONTH SHADOW REPORT ON THE PERFORMANCE OF THE INCLUSIVE OF ZIMBABWE
13
Select target paragraph3
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